The future of thousands of Vauxhall workers in Britain remains uncertain after Magna, the Canadian components maker, agreed a preliminary ­rescue of General Motors’ European business last night.

The deal was agreed between Magna and GM after a day of drama and delayed meetings that saw Italian car giant Fiat pull out of planned talks. The German government was due to meet Magna and GM last night to hammer out details.

Germany has been working desperately to secure a sale of Opel, which employs about 25,000 people in Germany and also includes Vauxhall, before GM files for bankruptcy in the US – a move expected by Monday.

Vauxhall employs more than 5,000 people at plants in Luton and Ellesmere Port. The business secretary Lord Mandelson has rejected union claims that one of the sites would be shut but said last night that he could not guarantee no job losses.

He said the Government would work with GM and Magna to secure production in the UK. Germany has called the shots in the sale of the European business because it has offered to put up billions of euros in loan guarantees to support a deal.

The bidding hit a crisis point yesterday morning when Fiat chief executive Sergio Marchionne rejected what he called “unreasonable” funding demands. Magna plans to cut 2,500 jobs in Germany, far fewer than the 10,000 cuts planned by Fiat.

Britain’s Unite union had warned that Fiat would close at least one of Vauxhall’s factories but Magna’s plans for the UK are not known. Both bidders had talked of cutting 10,000 jobs across Europe.

Tony Woodley, joint leader of Unite, has attacked Mandelson for not travelling to Berlin to fight for British jobs. Mandelson’s department said officials were in Berlin to put Britain’s case. Talks between Germany, the US government and GM, the stricken US car giant, broke down on Thursday when Washington rejected Germany’s plan to put Opel’s assets in a trust to shield them from GM’s creditors.

Magna, which Austrian emigre Frank Stronach started in a Toronto garage half a century ago, wants to use Opel to push into the Russian market.

Magna has said it will inject between E500million and E700million into Opel, assuming the deal gains government approval.

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